Toyota Kirloskar Motor recently announced that parent company Toyota Motor Corporation has decided to build a second plant in India at the company’s existing site in Bidadi near Bangalore.

The new plant is expected to commence operations in 2010, and will have an annual production capacity of around 100,000 vehicles, which would be increased over time. It will be set up at a cost of approximately Rs 1,400 crore (US$ 350 million).

The new facility will produce passenger vehicles, including the Corolla as well as a new small car, which is being developed with the aim of meeting the broad needs of customers in India. These cars would also be exported in the future.

Toyota says it will strive to achieve high local procurement levels for the new small car. The company also intends to increase the dealerships from its existing level, in future. In line with its increasing annual production capacity, affiliated suppliers are currently considering investment in the Indian industry as well.